New Zealand Labour Party

Secrecy surrounds social experiment

The secrecy surrounding the Government’s plans to let private funders invest in mental health services only increases suspicions that the proposal has been ill-thought through, Labour’s Health spokesperson Annette Kings says.

“The process with which New Zealanders have learned the Government is about to implement its social bond experiment could hardly have been less transparent.

“It was only after Labour and some media started asking questions that Health Minister Jonathan Coleman begrudgingly released any information about the scheme and even that has been like wringing blood from a stone.

“He has refused to release reports, extended response deadlines to Official Information Act requests and mislead the public on advice he’s received.

“Take for instance the spin he put on a report prepared for Internal Affairs, quoting that ‘[social bonds] are an exciting financial instrument with the potential to revitalise social policy delivery and inject private sector funding and innovation into the sector’.

“What he didn’t quote was that the sentence began with ‘In theory’ and the ensuing sentence read: ‘At this stage of their development their attraction to investors, even with government subsidy and assistance, is dependent on socially-motivated investors’.

“The report went on to say that ‘significant issues must first be addressed before even a trial is viable in New Zealand’ and that SIBs in the short term were likely to be overtaken by another ‘financial instrument’.

“It advised that New Zealand not engage in trials or implementation of a SIB issue.

“The Government appears hell-bent on introducing a hare-brained, half-baked scheme which has had little success anywhere else in the world, and which in some cases has led to investors calling for tax breaks.

"There is no reliable evidence this experiment will work and no reason why NGOs who are now doing the work cannot be directly contracted to provide the same social outcomes,” Annette King says.